Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model. NEW YORK ( TheStreet) -- Aflac (NYSE: AFL) has been reiterated by TheStreet Ratings as a buy with a ratings score of B+ . The company's strengths can be seen in multiple areas, such as its growth in earnings per share, revenue growth, notable return on equity, attractive valuation levels and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins.
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- AFL's revenue growth trails the industry average of 21.6%. Since the same quarter one year prior, revenues slightly increased by 6.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Insurance industry and the overall market, AFLAC INC's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
- AFLAC INC has improved earnings per share by 7.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, AFLAC INC increased its bottom line by earning $6.11 versus $4.13 in the prior year. This year, the market expects an improvement in earnings ($6.45 versus $6.11).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Insurance industry average, but is greater than that of the S&P 500. The net income increased by 8.0% when compared to the same quarter one year prior, going from $538.00 million to $581.00 million.
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